News
Opinion
On Jan. 5, registered voters in the town of Eagle will determine the future economic-development direction of the town, the future character and size of the town and the future expense to the taxpayer to maintain the infrastructure needed to support it. This vote is much larger than just the fate of Eagle River Station.
As one of two Town Board members who voted against Eagle River Station, I offer this letter as an alternative perspective to the foregone conclusion that Eagle River Station will be built.
You've heard the claims.
You've most likely been treated to a fireside chat with charming developers or, perhaps, an information meeting hosted by our fellow trustees who have shared their thoughts on why Eagle River Station is the right choice for Eagle's future and why our present situation is apparently so uncomfortable and unpalatable that we have no other choices for our future.
I, on the other hand, do have confidence in our future as a community without Eagle River Station or anything like it. I have confidence in our existing businesses and our unique assets as well as the creativity, passion and ability of our residents to find better solutions.
I offer the following facts to debunk the many myths and falsehoods being strewn about by the developer and by outspoken but misinformed proponents. I've affectionately dubbed their plight “The Fleecing of Eagle”: What about the $17.5 million in upfront fees? Isn't that a great deal for the town? If it were true, that'd be great. Any claim by the proponents that the town will receive an oversized, golf-tournament-style check for millions of dollars at the ribboncutting ceremony is, sadly, false. That money is primarily tied to impact fees, and a use tax, the developer will pay for services the town will be required to provide.
The fees include water and wastewater- plant investment fees, roadimpact fees, emergency-service fees and school-land dedications. Also, the developer will pay building-permit fees and inspection fees as the project is built, not up front.
Of those, only the permit and inspection fees and use tax (which could amount to $2 million to $3 million) will be put into the town's general fund. Those funds will be used first to pay the salaries of the building officials and inspectors who provide services. Any residuals could theoretically be spent on other services the town provides to its residents. We may see $15 million to $18 million in impact and service fees from the project depending on what gets built and, importantly, when and if it gets built. However, that money will already be spent to mitigate the development's direct impact on the town's infrastructure and services. It goes directly to pay for plant expansions and road improvements tied to the development — improvements we otherwise don't need. It's called a rational nexus, and we're bound by law to use those funds to pay for the development's proportional impacts on our systems.
What about new revenue for the town? Isn't $2.5 million per year a good deal?
No. Here's why: The town will commit its 4 percent sales tax to the Eagle River Station Metropolitan District to pay off approximately $62 million in bonds necessary to construct “public” improvements such as a new interchange east of town (not needed unless Eagle River Station is built and until traffic numbers were to increase dramatically, say by adding another 27,000 vehicle trips per day on local roads) and other improvements that primarily benefit the developer and Eagle River Station.
So the town gives up its 4 percent for 25 years or for as long as that debt exists (until $62 million in bonds are paid off). In fact, we will sign an agreement pledging our sales tax revenue to pay off the bonds, and there's no getting out of such obligation if the development goes dark, the developer walks or the district folds. Comforting, isn't it?
In return, the town will receive revenue generated by a “public improvement fee” charged on every item purchased in Eagle River Station. This fee could generate as much as $2.5 million annually, only at full build-out with 95 percent occupancy. This amount does not account for $595,000 in new costs to the town to service the development. That leaves just less than $2 million to the town in a great year.
These numbers are also based on the screwball premise that you, I and our neighbors in a “trade area” from Glenwood Springs to Silverthorne will spend a whopping 40 percent of our total household income on purchases at Eagle River Station. Do you spend 40 percent of your total household income on goods and services? I certainly don't and probably never will.
We will be taxing ourselves twice!
After giving up our 4 percent tax and imposing the public improvement fee, we will have taxed ourselves twice! When combined with state, local and county sales taxes, the total “point of sale” tax on goods purchased at Eagle River Station will be between 9.7 percent and 9.9 percent to pay for what the town's own financial consultant characterized as a “complex and expensive” project. Where is the logic in spending $62 million over 25 years only to make $40 million to $45 million ($1 million to $2 million net per year to the town over that same time period)?
In addition, the town did not build any protection into the agreements requiring the developer to mitigate potential sales tax losses due to new stores such as a Target cannibalizing other businesses or chewing up part of existing markets. City Market is a great example: Our biggest single sales tax generator will no doubt need time to “normalize” its operations after a Target takes business from it. What about impacts to our other existing businesses? What about the moratorium-like effect on investment and new business startups elsewhere in town while we wait to see if Eagle River Station gets built?
Voters also should be wary of anyone bold enough to claim that the town can then use any new revenue to redevelop other, ailing parts of the town's infrastructure. If the town were to get serious redeveloping parts of Old Town and Grand Avenue, $1 million to $2 million per year won't go far enough. The town will need to use the same creative financing tools we're about to extend to Eagle River Station in any future redevelopment scenarios. Reinvesting in our existing infrastructure is smarter growth and better policy. To do otherwise could be considered stupid growth and a slap in the face to property and business owners who have already invested in our town.
Using the same tools and spending similar amounts for redevelopment over perhaps the same, or a lesser, time period it will take to pay off a development the size of Eagle River Station is a more efficient use or leveraging of public funds, it's more efficient land use, and in the long term, it will be less expensive for taxpayers. Trying to produce enough revenue to pay for the impacts of our recent growth by encouraging more growth is a losing proposition — all day, every day!
Doesn't the town need the money?
Yes, of course. Every town in America needs money right now, always. Nowhere is this more pronounced and painfully obvious than in small towns like ours. In Colorado, we live and breathe (or die) by sales tax.
Our town manager is right: As our population has swelled, expectations and obligations to serve have risen. And we have a fiduciary responsibility to serve within our means. We have very real financial burdens looming and a responsibility to ensure the town is whole. I get it. So do a lot of residents. However, I prefer to get there by supporting our local businesses, by promoting and marketing the town and by ensuring our existing commercial areas build out and are vibrant.
Jobs, what about jobs?
Of course we could use jobs in Eagle County right now. But beyond temporary construction jobs, the sad fact is that of the 1,000-plus permanent and part-time jobs that could be created by Eagle River Station, only a fraction of workers will earn what could be considered a living wage in our county, and only a fraction of those will be able to afford to live in our community, much less purchase a unit at Eagle River Station. To claim the creation of more than 1,000 low- to medium-wage, service-sector jobs does anything to “diversify” our local or regional economy or add to our social wellbeing as a community is, again, false.
What else can the town do? We need money, and there's just no other way to get it, right?
Wrong. We have other options, starting with ensuring more residents patronize local businesses through promotions, advertising and customer surveying to understand which goods and services are missing and which businesses need improvement.
Moving forward with marketing and positioning the town for low-impact tourism industries, working with trade groups and forming regional partnerships are worthwhile and overdue options regardless of Eagle River Station. Working to create strong economic-development strategies and to update our town code to allow for more streamlined entitlement and permitting processes could incentivize new business startups and investment.
In fact, we know of other, similar towns using revenue sharing, marketing, branding and grants to create new industries and to generate new revenue streams equal to or exceeding those projected for Eagle River Station. It all adds up and, when applied across four existing business districts, could very well get us where we need to go. Unfortunately, such ideas are simply not talked about or explored in any depth at Town Hall. I have never said that the town won't or should not grow. However, growth, or expansion, is distinctly different from development. How, where and when we grow should be up to us, not an outsider. If, after engaging in economic-development planning and fully exploring options that would facilitate the build-out and infilling of existing commercial areas, we arrive at the decision that we need to expand east of town, we should master plan that area to protect our interests and our character. That way, we can dictate to a higher degree what gets built, when it gets built, what it will look like and how we will pay for it.
We can give direction to would-be investors and developers as to what is important to the town and what we actually need by way of living-wage jobs, new industry and diversification.
Even if this was a good deal for the town, there is no market! The local and national real estate markets are “slow.” Commercial lending and bond markets are “troubled,” and there are no guarantees that this development will ever get off the ground or be completed as planned.
Why extend three years vested rights and five years approval on an already outdated zoning concept plan to a developer who has presented no credible information to prove that it has the equity to complete the project in a fundamentally altered market? To the contrary, it has proven elsewhere that it doesn't have the means in this market.
To me, voting “no” meant putting our interests, values, natural assets and fiscal means first and putting all others' second. Those opposed to Eagle River Station are not opposed to growth. We're for Eagle. So please don't insult us with fearmongering and false claims of paydays that will most likely never materialize. We can and must do better!
In conclusion, I cannot support using your and my tax dollars to subsidize a hugely expensive private development project that sends profits out of town and leaves the town with empty storefronts, limited ability to redevelop existing infrastructure and the environmental, social, traffic and economic impacts that will no doubt follow. We should be more concerned with our bottom line than with an out-of-state developer's bottom line.
I ask you to please vote “no” on Eagle River Station. I did. It was easy.
P.S.: Don't forget to vote Jan. 5 at the Town Hall at 200 Broadway. Polls are open from 7 a.m. to 7 p.m.
Scot Hunn sits on the Eagle Town Board.
As one of two Town Board members who voted against Eagle River Station, I offer this letter as an alternative perspective to the foregone conclusion that Eagle River Station will be built.
You've heard the claims.
You've most likely been treated to a fireside chat with charming developers or, perhaps, an information meeting hosted by our fellow trustees who have shared their thoughts on why Eagle River Station is the right choice for Eagle's future and why our present situation is apparently so uncomfortable and unpalatable that we have no other choices for our future.
I, on the other hand, do have confidence in our future as a community without Eagle River Station or anything like it. I have confidence in our existing businesses and our unique assets as well as the creativity, passion and ability of our residents to find better solutions.
I offer the following facts to debunk the many myths and falsehoods being strewn about by the developer and by outspoken but misinformed proponents. I've affectionately dubbed their plight “The Fleecing of Eagle”: What about the $17.5 million in upfront fees? Isn't that a great deal for the town? If it were true, that'd be great. Any claim by the proponents that the town will receive an oversized, golf-tournament-style check for millions of dollars at the ribboncutting ceremony is, sadly, false. That money is primarily tied to impact fees, and a use tax, the developer will pay for services the town will be required to provide.
The fees include water and wastewater- plant investment fees, roadimpact fees, emergency-service fees and school-land dedications. Also, the developer will pay building-permit fees and inspection fees as the project is built, not up front.
Of those, only the permit and inspection fees and use tax (which could amount to $2 million to $3 million) will be put into the town's general fund. Those funds will be used first to pay the salaries of the building officials and inspectors who provide services. Any residuals could theoretically be spent on other services the town provides to its residents. We may see $15 million to $18 million in impact and service fees from the project depending on what gets built and, importantly, when and if it gets built. However, that money will already be spent to mitigate the development's direct impact on the town's infrastructure and services. It goes directly to pay for plant expansions and road improvements tied to the development — improvements we otherwise don't need. It's called a rational nexus, and we're bound by law to use those funds to pay for the development's proportional impacts on our systems.
What about new revenue for the town? Isn't $2.5 million per year a good deal?
No. Here's why: The town will commit its 4 percent sales tax to the Eagle River Station Metropolitan District to pay off approximately $62 million in bonds necessary to construct “public” improvements such as a new interchange east of town (not needed unless Eagle River Station is built and until traffic numbers were to increase dramatically, say by adding another 27,000 vehicle trips per day on local roads) and other improvements that primarily benefit the developer and Eagle River Station.
So the town gives up its 4 percent for 25 years or for as long as that debt exists (until $62 million in bonds are paid off). In fact, we will sign an agreement pledging our sales tax revenue to pay off the bonds, and there's no getting out of such obligation if the development goes dark, the developer walks or the district folds. Comforting, isn't it?
In return, the town will receive revenue generated by a “public improvement fee” charged on every item purchased in Eagle River Station. This fee could generate as much as $2.5 million annually, only at full build-out with 95 percent occupancy. This amount does not account for $595,000 in new costs to the town to service the development. That leaves just less than $2 million to the town in a great year.
These numbers are also based on the screwball premise that you, I and our neighbors in a “trade area” from Glenwood Springs to Silverthorne will spend a whopping 40 percent of our total household income on purchases at Eagle River Station. Do you spend 40 percent of your total household income on goods and services? I certainly don't and probably never will.
We will be taxing ourselves twice!
After giving up our 4 percent tax and imposing the public improvement fee, we will have taxed ourselves twice! When combined with state, local and county sales taxes, the total “point of sale” tax on goods purchased at Eagle River Station will be between 9.7 percent and 9.9 percent to pay for what the town's own financial consultant characterized as a “complex and expensive” project. Where is the logic in spending $62 million over 25 years only to make $40 million to $45 million ($1 million to $2 million net per year to the town over that same time period)?
In addition, the town did not build any protection into the agreements requiring the developer to mitigate potential sales tax losses due to new stores such as a Target cannibalizing other businesses or chewing up part of existing markets. City Market is a great example: Our biggest single sales tax generator will no doubt need time to “normalize” its operations after a Target takes business from it. What about impacts to our other existing businesses? What about the moratorium-like effect on investment and new business startups elsewhere in town while we wait to see if Eagle River Station gets built?
Voters also should be wary of anyone bold enough to claim that the town can then use any new revenue to redevelop other, ailing parts of the town's infrastructure. If the town were to get serious redeveloping parts of Old Town and Grand Avenue, $1 million to $2 million per year won't go far enough. The town will need to use the same creative financing tools we're about to extend to Eagle River Station in any future redevelopment scenarios. Reinvesting in our existing infrastructure is smarter growth and better policy. To do otherwise could be considered stupid growth and a slap in the face to property and business owners who have already invested in our town.
Using the same tools and spending similar amounts for redevelopment over perhaps the same, or a lesser, time period it will take to pay off a development the size of Eagle River Station is a more efficient use or leveraging of public funds, it's more efficient land use, and in the long term, it will be less expensive for taxpayers. Trying to produce enough revenue to pay for the impacts of our recent growth by encouraging more growth is a losing proposition — all day, every day!
Doesn't the town need the money?
Yes, of course. Every town in America needs money right now, always. Nowhere is this more pronounced and painfully obvious than in small towns like ours. In Colorado, we live and breathe (or die) by sales tax.
Our town manager is right: As our population has swelled, expectations and obligations to serve have risen. And we have a fiduciary responsibility to serve within our means. We have very real financial burdens looming and a responsibility to ensure the town is whole. I get it. So do a lot of residents. However, I prefer to get there by supporting our local businesses, by promoting and marketing the town and by ensuring our existing commercial areas build out and are vibrant.
Jobs, what about jobs?
Of course we could use jobs in Eagle County right now. But beyond temporary construction jobs, the sad fact is that of the 1,000-plus permanent and part-time jobs that could be created by Eagle River Station, only a fraction of workers will earn what could be considered a living wage in our county, and only a fraction of those will be able to afford to live in our community, much less purchase a unit at Eagle River Station. To claim the creation of more than 1,000 low- to medium-wage, service-sector jobs does anything to “diversify” our local or regional economy or add to our social wellbeing as a community is, again, false.
What else can the town do? We need money, and there's just no other way to get it, right?
Wrong. We have other options, starting with ensuring more residents patronize local businesses through promotions, advertising and customer surveying to understand which goods and services are missing and which businesses need improvement.
Moving forward with marketing and positioning the town for low-impact tourism industries, working with trade groups and forming regional partnerships are worthwhile and overdue options regardless of Eagle River Station. Working to create strong economic-development strategies and to update our town code to allow for more streamlined entitlement and permitting processes could incentivize new business startups and investment.
In fact, we know of other, similar towns using revenue sharing, marketing, branding and grants to create new industries and to generate new revenue streams equal to or exceeding those projected for Eagle River Station. It all adds up and, when applied across four existing business districts, could very well get us where we need to go. Unfortunately, such ideas are simply not talked about or explored in any depth at Town Hall. I have never said that the town won't or should not grow. However, growth, or expansion, is distinctly different from development. How, where and when we grow should be up to us, not an outsider. If, after engaging in economic-development planning and fully exploring options that would facilitate the build-out and infilling of existing commercial areas, we arrive at the decision that we need to expand east of town, we should master plan that area to protect our interests and our character. That way, we can dictate to a higher degree what gets built, when it gets built, what it will look like and how we will pay for it.
We can give direction to would-be investors and developers as to what is important to the town and what we actually need by way of living-wage jobs, new industry and diversification.
Even if this was a good deal for the town, there is no market! The local and national real estate markets are “slow.” Commercial lending and bond markets are “troubled,” and there are no guarantees that this development will ever get off the ground or be completed as planned.
Why extend three years vested rights and five years approval on an already outdated zoning concept plan to a developer who has presented no credible information to prove that it has the equity to complete the project in a fundamentally altered market? To the contrary, it has proven elsewhere that it doesn't have the means in this market.
To me, voting “no” meant putting our interests, values, natural assets and fiscal means first and putting all others' second. Those opposed to Eagle River Station are not opposed to growth. We're for Eagle. So please don't insult us with fearmongering and false claims of paydays that will most likely never materialize. We can and must do better!
In conclusion, I cannot support using your and my tax dollars to subsidize a hugely expensive private development project that sends profits out of town and leaves the town with empty storefronts, limited ability to redevelop existing infrastructure and the environmental, social, traffic and economic impacts that will no doubt follow. We should be more concerned with our bottom line than with an out-of-state developer's bottom line.
I ask you to please vote “no” on Eagle River Station. I did. It was easy.
P.S.: Don't forget to vote Jan. 5 at the Town Hall at 200 Broadway. Polls are open from 7 a.m. to 7 p.m.
Scot Hunn sits on the Eagle Town Board.
